In this recent interview with Pharmanews, Managing Director/CEO of Embassy Pharma & Chemicals Limited, Pharm. (Sir) Nnamdi Obi , speaks on the challenges facing local drug pharmaceutical manufacturers in Nigeria and why the Nigerian government should give local manufacturers national honours. Sir Obi, who is also the president of the Association of Pharmaceutical Importers of Nigeria (APIN), also discloses the implications of the ECOWAS Common External Tariff for the pharmaceutical sector and what the government can do to consistently ensure Nigerians have access to quality medicines. Excerpts:
Local drug manufacturers under the aegis of the Pharmaceutical Manufacturers Group of the Manufacturers Association of Nigeria (PMG-MAN), recently urged President Buhari to consider retaining the 20% adjustment tax on imported finished pharmaceutical products instead of upholding the ECOWAS Common External Tariff (CET) regime which stipulated zero import duty on imported medicine. What is APIN’s position on this ECOWAS CET – should Nigeria uphold or jettison it?
The fact is that reducing tax on imported finished pharmaceutical products from 20 per cent to zero per cent as stipulated by the ECOWAS CET is something we drug importers applaud and commend as the right thing to do because it will make drugs more affordable. However, it is also our view that it is not fair that the government should have a tax of 5 or 10 per cent for imported raw materials for pharmaceutical manufacturing as it is today.
It is my view that the government should do a holistic review of duty payable by manufacturers and ensure it is reduced to zero per cent. It is also important to have incentives in place to support local drug manufactures. While we importers are happy that the reduction of import duty on imported pharmaceuticals is beneficial to us, however, we are patriotic enough to ask what the country is doing to support and encourage local manufacturers. We don’t have any other country but Nigeria.
The Nigerian economy cannot be energised until we have a very vibrant manufacturing sector, which is the real sector; so we have to energise the sector.
The Nigerian government should be commended because of the zero per cent duty on imported drugs because it will help the preponderance of the poor Nigerians to get drugs at affordable rates as most of the drugs used in Nigeria are imported. But we must also think of how to help boost local drug manufacturing. There has to be a review of the duty charged on raw materials. I do not think it is right to charge 5 per cent or 10 per cent on raw materials for drugs and have zero per cent on finished products. This should be looked into.
Even though it is good for importers, I do not think that people who have made enormous investment in manufacturing locally should pay so much for their raw materials. The government should thus not just reduce the duty charged but should also provide incentives for them. They should be able to access cheap funds to develop. I know there is Bank of Industry (BOI); but realistically, how many of our manufacturers are able to access funds from the BOI? I strongly doubt that is happening presently.
I know the present DG of NAFDAC, Dr Paul Orhii, is doing a lot to help attract cheap funds for the manufacturers. He has helped about five local pharmaceutical manufacturers to have WHO prequalification certification. That was not the case before now. The government should go a step further and ensure these local manufacturers have access to funds. This is because most banks in Nigeria don’t want to fund long-term projects, which is not the case in other advanced climes.
As I said at a programme recently, a friend of mine established a pharmaceutical manufacturing firm in India that cost close to 200 million dollars and his personal money in the project was not more than 25,000 dollars. Yet, he was able to establish a world-class factory. So, when we start comparing ourselves with all these advanced climes, we should be able to ask what the government has put in place in those places to make things work and ensure their economy is vibrant, and replicate same in our clime.
It has been argued that if Nigeria really wants to develop the local pharmaceutical manufacturing sector, we have to come up with policies that will restrict the volume of finished drugs manufactured imported into the country. How sound is this argument?
I don’t agree with that. The fact is that we have to put the right things in place first. When the right things are done, every other thing will fall in place.
Seeing the kind of deficit in infrastructure we have in this country at the moment, if we go ahead and restrict importation of some drugs as it was even done in the past, it would result in tremendous increases in the prices of products. At the end of the day, it is the common man that will suffer.
So, I don’t subscribe to such sentiment. What we should do is to first have a vibrant economy. The government must first provide the enabling environment through ensuring we have the required infrastructure for the real sector (manufacturing) to thrive.
If you want to start drug manufacturing company here in Nigeria, virtually all your raw and packaging materials will be imported. The only thing you will not import is water. But even though you are getting the water locally, you still have to treat it. So, how can you make products that are competitive? It is not going to be.
I quite commend local manufacturers. It is not easy. I have in fact called on the government to give national honours to those that are manufacturing locally. Rather than dolling out national honours to politicians whose only contribution is that they’ve been in the corridors of power for some time. Local manufacturers really deserve national honours.
That is why I admire the action of the immediate past president when he gave our second highest national honour to Alhaji Aliko Dangote and Dr Mike Adenuga. Even though some Nigerians criticised that decision, thinking only the vice president or some other top politicians should get that honour. But, I found that criticism laughable. The quantum of contribution those two men have made in our economy by providing job opportunities to millions of Nigerians is enormous. Your guess is as good as mine on what would have been the case if such multitude of Nigerians were not employed. That will no doubt have created enormous security problem for this nation. An idle mind is the devil’s workshop anytime, any day. Just ensuring somebody is gainfully employed means a social problem has been solved by such opportunity.
Thus, giving a manufacturer who has employed a certain number of Nigerians, a national honour is the right thing to do. Anybody who begrudges that should go and start manufacturing too.
If you were to advise this new government on policies that can be implemented to make drugs more affordable and available, what will your advice be?
As I said earlier, the government policy on having zero duty on imported pharmaceuticals is a step in the right direction. In addition to that, we should also address the concerns of local drug manufacturers by making raw materials importation for them at zero per cent. This should also be in addition to ensuring that they have access to funds at very affordable rates, one digit at the most, and not more than 5 per cent. That will make drugs available and affordable. Such combinations of factors will help in making drugs more affordable to millions of Nigerians.
APIN contributed so much in supporting the Nigerian army in fighting insurgency, what are the other important issues the association has been focusing on?
We have done a lot for the industry without making so much noise about it. Without any fear of contradiction, APIN has done so much for the pharma sector in Nigeria and the country. You were there when we made a presentation to the Nigerian army at a time when there was an avalanche of condemnation of the army – that they were not meeting the expectation of Nigerians. Their morale was at the lowest ebb and we made donation of drugs and food products from our friends from the good sector in the industry. The then chief of Defence Staff, Air Marshal Alex Badeh, told me that our donation was very significant in uplifting the morale of the soldiers involved in fighting the insurgency especially coming at a time many Nigerians were criticising the army. We were glad to make that contribution.
To the pharma industry, too, we have made contributions. We were involved in the new government policy on drug distribution. We are happy that there is now a window for the wholesale centres being at par with the mega drug distribution centres which was not what was in place initially. If this policy had not been properly handled, most pharmaceutical manufacturers and importers would have had serious problem. This is because it would have been diffult for these two stakeholders to make drugs available.
We have also been collaborating with NAFDAC to make sure that things move on very well in the health sector. It was with our active collaboration with NAFDAC that made more Sildenafil citrate to be registered with NAFDAC in Nigeria. Before now, there were many Sildenafil with doubtful efficacy in the environment. But when NAFDAC, in its wisdom, liberalised the registration of Sildenafil citrate which had hitherto been the exclusive preserve of only one company, that we began to have alternative brands in the market. So, thanks to NAFDAC and APIN, Nigerian men who have erectile dysfunction can now access Sildenafil citrate at very affordable rate. There are over 40 brands approved by NAFDAC in the market now unlike when a particular company had exclusive right over it. We contributed to that.
There will be a change of leadership during the 88th Annual PSN Conference where a new president is expected to emerge. What are your expectations from the incoming leadership of the PSN?
The current PSN president, Pharm. Olumide Akintayo, has really done well and has taken the PSN to an enviable position. For me, whoever that will take over from him has to be on his toes to sustain the momentum of development. I am not expecting anything less from Akintayo’s successor. I will be at the conference and whoever will get my vote will be somebody I am sure will deliver and take us to the next level.